Minervini looks for the "Volatility Contraction Pattern" (VCP). This is a period of consolidation where price fluctuations tighten significantly, indicating that supply has been absorbed by institutional buyers.
Before analyzing a stock’s financials, a wizard filters out 90% of the market using the . You should never buy a stock that is in a downtrend. A stock must meet these criteria to be considered:
Because winning trades have proven they are right. They have built a cushion between your average cost and your stop loss. This allows you to scale into a massive position with virtually no additional risk.
To achieve consistent super-performance, you must execute a daily and weekly preparation routine. You should never buy a stock that is in a downtrend
Maintain a minimum ratio of 2:1 or 3:1. If your average loss is 5%, your average gain must be 10% to 15%.
As the stock moves from left to right through the VCP, the price fluctuations become tighter, and the trading volume dries up significantly.
The market is a mirror of human psychology. Greed causes traders to chase extended stocks; fear causes them to cut winners too early or hold onto losers hoping for a bounce. A superperformer treats trading like a professional business, executing setups with clinical neutrality and viewing losses simply as the routine cost of doing business. 2. The Core Philosophy of Market Wizards This allows you to scale into a massive
Stop trying to predict the market. Start reacting to it. Trade like a stock market wizard, and you will achieve the super performance that 99% of investors believe is impossible.
You must have pre-determined stop-loss orders to protect your capital if the trade fails, and profit-taking targets to lock in your gains. 3. Mastering the Four Stages of a Stock’s Life Cycle
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: Place price alerts just below the pivot point so you are ready to trade when the momentum triggers.
The moment of truth is the . This is not a random breakout. It is the exact price level where the stock clears all prior resistance on volume at least 40-50% above the average daily volume.
If you want to apply these concepts to your own portfolio, let me know: Your with technical charting patterns.
You don't buy a stock just because it is good; you buy it when it is ready to move. Minervini focuses on the .